If interest rates do not affect the demand for money,then velocity is ________ likely to be ________.

Question

Quizplus · Accepted Answer

If interest rates do not affect the demand for money, then velocity is more likely to be stable. This is because velocity is determined by factors such as the level of economic activity, the efficiency of the payment system, and the availability of credit, rather than interest rates. When these factors remain stable, velocity also tends to remain stable.

If Interest Rates Do Not Affect the Demand for Money,then